Belle Vernon Area will refinance bond issue
With the budget approval deadline fast approaching, the Belle Vernon Area School Board spent most of its meeting Monday settling financial matters.
The board unanimously agreed to refinance a portion of a five-year-old bond issue for an estimated one-time savings of $137,000.
The issuance of the general obligation bonds, not to exceed $5,250,000, will pay off the outstanding bond, go to various capital improvement projects and pay the cost of issuing and insuring the new bonds.
The anticipated interest rate would decrease from a 3.9 percent average to a fixed rate of 3.03 percent or less.
Superintendent Dr. John Wilkinson compared the action with refinancing a home at a lower interest rate while keeping the same payment schedule. The savings, however, will be limited to such expenditures as building and grounds improvement projects.
“The bottom line becomes you don't change anything you currently have and you're getting a windfall of $137,000 that you can put into your capital improvement fund and use it for buildings or reduce your debt service. But we chose to put it into our facilities instead,” board member Aaron Bialon explained after the meeting.
“Your debt service repayment remains the same through 2018 and then it's done.”
Belle Vernon Area can close on the deal July 24 when the new bond issue will be put up for bid via an online auction.
“You'll have banks battle it out like an auction for your bonds, because we have such a good rating. But the board still has final approval,” Wilkinson said.
“As soon as we close, that money gets deposited right into our account. We can buy new text books next year or you can let it sit, but you can't use it for teachers' salaries or anything like that. It has to be for something that lasts several years.”
The board agreed to pay the Central Westmoreland Career and Technology Center $62,926 annually for the next 15 years to offset renovation and repair costs – including an outdated roof and boiler system.
The initial plan offered to the school board in October by CWCTC director Brad Elwood asked for nearly $100,000 per year.
“The overall project cost was pared down from $9.7 million to $6.4 million,” Bialon, who attended a recent CTC meeting, told the board.
“These items have never been replaced since the inception of the building. Should a boiler go down, you wouldn't have facilities available for the students for approximately six weeks.”
Nine Westmoreland County school districts will share the cost in proportion to how many students have attended the vocational school the past three years.
“Last year, we came pretty close to a boiler going down, so you could see the overall impact if something catastrophic like that would happen,” Bialon said. “Dr. Wilkinson worked extensively in reduction of the cost, and obviously it's more beneficial for us as well as the other districts involved.”
About 50 BVA students took classes at the center this past school year, with only Hempfield sending more students.
In other action, the board:
• Authorized a transfer of $266,868 from the general fund into the Pennsylvania Local Government Investment Trust fund for the budget ending June 30. It agreed to transfer $342,708 from PLGIT into the general fund. The latter was required as a financial reporting provision for post-employment benefits.
• Raised lunch prices by 10 cents for elementary ($2) and secondary students ($2.30).
• Approved one-year salary increases for three confidential secretaries, four nonunion “head” cooks and the school board secretary.
• Purchased stage curtains and lining for Belle Vernon Area Middle School for $4,825, which includes installation and a three-year warranty.
• Accepted a proposal from CCL Technologies to replace the paging system at Marion Elementary with a Cisco/Singlewire paging system including a built-in bell scheduler for $57,578.
• Accepted the following resignations: Annette Clay, family and consumer science teacher; Denise Shusta, English teacher; Steven Toth, health and physical education teacher; Mario Muccinio, custodian; and Robert Baron, security guard.
• Approved a service agreement with Adelphoi Education for next school year with a daily tuition schedule of $72.75 for regular students and $80.10 for special education students, as needed for disruptive students.
Rick Bruni Jr. is a staff writer for Trib Total Media. He can be reached at email@example.com or 724-684-2635.